Employment and Support Allowance is supposed to help those in need. Yet a major error by the Department for Work & Pensions has resulted in an estimated 70,000 people being underpaid for years.

Those affected have lost out on an average of £5,000 each. It is appalling that over 20,000 of those most in need are owed around £11,500 and some as much as £20,000.

This unacceptable and entirely avoidable situation stems from multiple failures on the part of the Department.

Department failed to subject process to proper scrutiny

It failed to design a process that reflected its own legislation. It failed to subject that process to proper scrutiny. It failed to listen to its own staff, claimants, or external stakeholders and experts who told it things were going wrong and that it needed to slow down. And it failed to act even when it was painfully obvious that it was underpaying a significant number of people, taking over six years to take the necessary corrective action.

The Department is now finally paying arrears but it is only paying claimants some of the benefit they have missed out on. It is not planning to pay any compensation to reflect the lost value of passported benefits such as NHS prescriptions, dentistry treatment and free school meals.

There is clearly much more to be done to right this wrong. We encourage the Department to act swiftly, decisively and comprehensively to address the harm caused by this mistake and, more broadly, to give much greater priority to correcting benefit underpayments to vulnerable people.

Chair's comments

Comment from Committee Chair, Meg Hillier MP:

"Thousands of people have not received money essential for living costs because of Government’s blinkered and wholly inept handling of ESA.

The Department simply didn’t listen to what claimants, experts, support organisations and its own staff were saying.

Its sluggishness in correcting underpayments, years after it accepted responsibility for the error, points to weaknesses at the highest levels of management.

Indifference has no place in the delivery of vital public services. It must be rooted out wherever it is found.

The Department needs to explain what it is doing to improve both its management culture and its ability to gather and act promptly on critical intelligence.

It must also set out how it will more quickly address the £1.7 billion of underpayments claimants miss out on each year.

Half-hearted Whitehall targets offer no comfort to people struggling to make ends meet because of Government mistakes."